U.S. Stock Futures Gain on Ukraine Accord as S&P 500 Nears Peak
New York (Feb 12) US stock-index futures advanced, indicating the Standard & Poor’s 500 Index will inch closer to its record, after all-night talks sealed a cease-fire for Ukraine.
Contracts on the S&P 500 expiring in March added 0.5 percent to 2,076.7 at 6 a.m. in New York. Dow Jones Industrial Average futures gained 95 points, or 0.5 percent, to 17,926.
A peace summit between Ukrainian President Petro Poroshenko, Russian President Vladimir Putin and French and German leaders ended early Thursday with an accord on a cease- fire to stem the conflict that’s devastated eastern Ukraine. The news sent Russian and European equities higher.
The S&P 500 is about 22 points away from a record reached Dec. 29, with equities fluctuating between gains and losses before closing little changed yesterday after a decision on new bailout terms for Greece was postponed to next week. Optimism that Greece is moving toward an agreement with its creditors underpinned today’s rally in Europe.
“Hopefully, the cease-fire in Ukraine will allow investors to move on,” said Kully Samra, who manages U.K. clients for Charles Schwab Corp. in London. “That’s helping push markets higher. People also seem to be looking beyond the fact that there is no deal on Greece yet. We’re in a bull market but there are enough external factors that increase the chance of a correction. The strong U.S. economy keeps being overshadowed by headlines from overseas. It’s going to be a volatile year.”
Awaiting Earnings
With the S&P 500 trading at 17.4 times its members’ projected earnings, a multiple 21 percent higher than the five- year average, investors are analyzing earnings reports to assess stocks valuations.
The plunge in oil prices has spurred analysts to lower their profit estimates for energy companies, while overall estimates for the first quarter have fallen the most in six years.
Kellogg Co., Kraft Foods Group Inc., and American International Group Inc. are among the 17 S&P 500 companies releasing quarterly results today. Almost three-quarters of index members have reported results so far, with 77 percent beating profit estimates and 57 percent topping sales projections, data compiled by Bloomberg show.
Cisco Systems Inc. jumped 6.6 percent in early New York trading as profit and sales topped estimates after customers upgraded their networks. TripAdvisor Inc. rallied 14 percent in late trading after posting better-than-projected revenue. Whole Foods Market Inc. added 2.8 percent after price cuts led to a 10 percent increase in first-quarter sales.
Tesla Motors Inc. dropped 8.7 percent after the electric- car maker missed targets for vehicle deliveries and reported an unexpected loss. Zulily Inc. slumped 23 percent after the online retailer said annual sales probably won’t exceed $1.65 million, below analysts’ predictions of $1.76 million.
Source: MSN
